Guide to Simple and Secure International Payment Methods

Cashless payments bring a world of benefits, whether you’re shopping online or making an international transaction. Do you know that global cashless payments are all poised to surge by 80% between 2020 and 2025?

In a globalised world, the choice of international payment methods largely defines your shopping experience. There’s no denying that cross-border money transfers are essential for individuals and businesses alike. Whether you’re purchasing something from an eCommerce site abroad or handling international trade, it’s essential to understand different types of overseas payment methods. The efficiency and security of your transactions depend on these payment methods.

In this comprehensive guide, we have discussed how to choose the right payment method for cross-border shopping or payments. We have also curated the five best methods of international payment along with their pros and cons.

Key Statistics Defining Current Trends of International Payment Methods

Check out these crucial numbers that define the extensive use of international payment methods.

• In 2024, the total transaction value in international digital payments is likely to hit $11.53 trillion.
• Between 2024 and 2028, the total value of international payments is projected to grow at a 9.52% CAGR.
• Digital commerce is the largest market of international payment gateways, with a total transaction value of $7.62 trillion in 2024.
• Digital wallets accounted for more than 50% of international eCommerce payments in 2023
• According to Stripe, the US dollar is the most used currency in international payments.
• The Asia-Pacific region records the highest growth in cashless transactions, with a 109% growth projected till 2025.

Factors To Consider While Choosing A International Payment Method

For reliable international payments, it’s imperative to choose the right payment method. Here are the key factors to consider when you choose a payment method for international transactions.

Transaction Cost

Consider the processing charges and other fees associated with international transactions for each method. Choose an option that balances both functionality and affordability. High transaction costs shouldn’t erode your profit margins. Also, consider the initial setup costs and ongoing transaction charges.

Security Measures

Check out security features like tokenisation and encryption for reliable international payments. It’s imperative to secure your customers’ information from data breaches and fraud.

Transaction Processing Speed

When it comes to international payments, consider a method that allows you to instantly transfer funds. Timely payments not only boost customer satisfaction but also improve your cash flow, which is crucial for keeping your business running smoothly and ensuring financial stability.

Streamline International Payments

It pays to choose the most appropriate methods of international payment that offer a user-friendly interface. With a seamless payment process, you can reduce the chances of cart abandonment and enhance overall customer satisfaction.

Optimize with Payment Insights

Choose one of the payment methods that empower you with detailed insights into the spending patterns of your customers. With data insights, you can gain valuable information about their purchase behaviour. Accordingly, you can tweak your marketing strategies and optimiseoptimize inventory management.

How to Safely Use International Payment Methods?

Before using any payment gateway or other method for international transactions, check out the payment terms in international trade on the platform. Here are a few ways to use different international payments safely.

Use secure payment gateways

Make sure to choose one of the established payment gateways. It should ensure security with strong encryption and data protection protocols. At Ubuy, we use secure gateways to protect our customer data from unauthorised access and cyber threats.

Avoid unsecured channels

Never share payment information through unencrypted or unreliable channels. It’s advisable to use secure and verified platforms for financial transactions. This stands as your line of defencedefense against fraud and data breaches.

Monitor account activity

Check your financial accounts regularly for any unauthorised transactions. When you identify these discrepancies promptly, you can mitigate potential risks and secure yourself from financial losses.

Enable two-factor authentication

For an additional layer of security, enable 2FA on your accounts. This extra verification step in overseas payment methods significantly reduces the risk of unauthorisedunauthorized access to payment details.

Report suspicious activity

In case you detect any suspicious transactions, report the issue immediately to your payment provider. Instant reporting can resolve problems swiftly and strengthen overall security for international payments.

Different Types Of International Payment Methods Available

Now, have a look at the top international payment methods along with their benefits and drawbacks.

Credit Cards

Credit cards are one of the most extensively used methods for international payments. Their global acceptance and immediate processing make them so popular.

Some credit cards come with rewards like cashback and travel benefits. However, some credit cards involve high transaction fees and interest charges if you don’t pay the balances in full. Typically, transaction fees range from 1.5% to 3.5% of the purchase amount.

Pros

• Widely accepted globally
• Instant transaction processing
• Rewards and cashback benefits

Cons

• High foreign transaction fees
• Interest charges on unpaid balances

Debit Cards

One of the most straightforward international payment methods, debit cards draw money directly from your bank account. Thus, they avoid the accumulation of debt and you need not pay any interest. However, these cards may not be accepted everywhere and come with fewer fraud protection mechanisms compared to credit cards.
Transaction fees on debit cards are generally lower, with each transaction costing a few cents. Debit cards offer a direct connection to your bank while minimising the risk of overspending.

Pros

• Directly linked to your bank account
• Avoids interest charges
• Lower transaction fees

Cons

• Limited global acceptance
• Less fraud protection

PayPal

PayPal is a popular choice for instant international payments. It is reputed for its security and support for multiple currencies. As one of the most widely used international payment methods, PayPal offers buyer protection and supports easy online transactions.

The fee varies for currency withdrawals and conversions. Typically, it ranges from 2.5% to 4%. PayPal is convenient for both personal and business transactions. It allows users to send and receive money globally.

Pros

• Supports multiple currencies
• Offers buyer protection
• Easy and secure online transactions

Cons

• Fees for currency conversion
• Withdrawal fees

Wise

Wise has emerged as one of the most extensively used overseas payment methods. It is noted for its transparent fee structure and the use of the mid-market exchange rate. This significantly reduces the cost of international transactions. Wise allows users to hold and manage funds in over 40 currencies and offers competitive fees, often ranging from 0.5% to 1% of the transaction amount.

Wise is perfect for sending large amounts and making batch payments efficiently. However, it might not be as widely accepted as traditional methods. Besides, there are certain limitations in currency support.

Pros

• Transparent fees
• Uses mid-market exchange rate
• Allows multi-currency accounts

Cons

• Limited acceptance compared to traditional methods
• May not support all currencies

Stripe

Stripe is a leading payment gateway for online businesses. It supports a wide range of currencies and offers advanced features for eCommerce transactions. It seamlessly integrates with online platforms, but comes with higher fees. Generally, it is around 2.7% and an additional 5 cents for in-person transactions.

However, the setup process for stripe is a bit complex. This makes it suitable for businesses with specific needs and technical resources.

Pros

• Supports multiple currencies
• Advanced e-commerce features
• Seamless integration for online transactions

Cons

• Higher fees for transactions
• Complex setup process

Wrapping Up

Whether you’re shopping or making a payment to your vendors, it’s crucial to choose the right international payment methods. Now that we have discussed the most popular methods and how to choose the right one, you can make an informed decision.
Whether you use credit cards, debit cards, PayPal, Wise, or Stripe, you must be aware of the payment terms in international trade for each platform. As cashless transactions pick up pace across the globe, optimiseoptimize your international financial dealings with the right method in place.

Frequently Asked Questions